Personal Pension  

FCA could back ‘one click’ self-directed pension transfer

FCA could back ‘one click’ self-directed pension transfer

There is no reason why the Financial Conduct Authority would not back ‘one click’ self-directed pension transfers, according to the Australian chief of a platform engine.

Robert DeDominicis, chief executive of platform engine GBST Wealth Management, said advisers wanting to know what the future holds for pension freedoms should look to his birthplace of Australia.

Speaking at the James Hay autumn conference today (17 September), Mr DeDominicis said the Australian government realised it had “to get ready for this online thing” and initiated the SuperStream reforms in the last 12 months that allowed pension transfers at the click of a button.

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When asked would the FCA, which requires those wishing to undertake defined benefit transfers with a ‘pot’ of over £30,000 to receive advice, would ever back a similar system in the UK, Mr DeDominicis said “It is a self-directed mechanism. I can’t see why not.”

His comments followed yesterday’s (16 September) publication of the FCA’s analysis of pension freedoms data which found that from a total of 107 responses, 61 per cent of pension providers said they will accept pension transfer requests from insistent clients “in certain circumstances” and 30 per cent refused to accept any transfer requests from clients who do not to listen to advice.

Under Australia’s SuperStream reforms, employers must make super contributions on behalf of their employees by submitting data and payments electronically in a consistent and simplified manner.

According to Mr DeDominicis, SuperStream has taken pension transfers from 30 days to five – and enabled one-click consolidation of pension accounts.

Mr DeDominicis said: “SuperStream is all about taking out the costs and making it simpler.”

While the Australian reforms have only been in place for 12 months, Mr DeDominicis said the system has reduced incidents of errors and allowed some of his company’s Australian banking clients to allow their customers to take multiple pension pots and turn them into one at the click of a button.

He said: “ANZ - all the main high street banks - have customers from cradle to the grave. Their customers can look at credit card, investments and pensions, all in one place.

“It is interesting to see how engagement has changed from 10 years ago. You can now round up your pension pots with three simple clicks.

“No more paper forms. You do it all online in just a few quicks.”

A packed room at the Grange St Paul’s Hotel in London today (17 September) were told how the bank uses SuperStream data to allow customers to see all their pension funds listed in one place and allows them to just press the transfer button to pull the various pots together.”

SuperStream works by getting employers to collect their staff member’s unique superannuation identifier (USI) for APRA-regulated funds, ABN for their SMSF funds, bank account details and electronic service address.

Mr DeDominicis said: “All pension fund providers have to have an electronic gateway to say if they have a fund for a tax file number.